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When the trustor of a trust passes, there are certain notifications that must be made by the trustee. Along with these notifications, the trustee also assumes many, if not all of the duties and obligations previously held by the trustor. One of these duties includes the allocation of the assets of the trust to the beneficiaries. Each beneficiary must be notified of this passing, and the law allows for various methods by which to notify the beneficiaries.
The first notice that is required is the notice to beneficiaries. This notice, includes among other things a statement that the previous revocable trust is not irrevocable, and that gives the beneficiaries a statement of their entitlements to disbursement. Along with the entitlements, the notice to beneficiaries must also include instructions to each beneficiary indicating that they are entitled to a copy of the trust, and how to obtain said copy, should they be interested.
Very often, the trustor will not be a member of the immediate family of the people who originally created the trust, but will be a lawyer or a representative law firm charged with the execution of the trust upon the original creator’s death(s).
Included in this same notice must also be instructions for how each beneficiary may challenge the validity or legality of the trust. In the case of a beneficiary challenging the trust in any way, most courts wish to start, and conclude the challenge process in a timely fashion, and typically, will issue a date upon which no more challenges may be issued by any of the beneficiaries. Very often, beneficiaries may not challenge the overall validity of the trust, but may challenge their own, or another beneficiary’s right to a portion of the trust. This challenges must also be brought before the court system within the time frame stated in the original notice to beneficiaries.
Any beneficiaries bringing challenges to any part of the trust during this time also bring to a halt the disbursement of the entire trust, which often results in lengthy delays, and very expensive court costs for all parties involved. Many irrevocable trusts also include clauses predicting these actions, and will state that the assets of the trust may not be used to pay for the legal costs involved in challenging the trust.
Finally the notice to beneficiaries must include a date and time for the settlement of the now irrevocable trust, as well as including a physical address where the trustor may be contacted. Any beneficiaries having questions about the trust are encouraged to contact the trustor, or their representative legal firm in order to resolve disputes or receive their disbursements under the guidelines of the trust.
The laws regarding the formation of a trust, and the execution of said trust can be very confusing for the beneficiaries as well as the trustor, if not an experienced legal professional. Part of the reasoning behind the notice to beneficiaries is to ensure that not only the spirit in which the trust was formed may be followed, but the actual letter of the intent of the trust as well.
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